The Natural Rate of Unemployment Is Defined as the Rate

question 277

Multiple Choice

The natural rate of unemployment is defined as the rate of unemployment that

• A)prevails in long-run macroeconomic equilibrium, when all workers and employers have fully adjusted to any changes in the economy.
• B)prevails in the short-run macroeconomic equilibrium, before workers and employers have had a chance to adjust to an economic shock.
• C)exists due to welfare and unemployment benefits that reduce potential workers' incentives to find work.
• D)exists only during periods of recession or depression in the economy.

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